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tv   U.S. House of Representatives  CSPAN  July 1, 2011 10:00am-1:00pm EDT

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downgrading of history, the assessment board is somewhat complicit in this because this testing regime really results in the narrowing of the curriculum in a variety of ways. host: we will stop there because we're almost out of time. a response. guest: i don't think the board is complicit in the narrowing of curriculum. our job is to periodically assess a variety of subjects across three gray levels and provide information to the nation. our board is not actually responsible for changing the local bar to lend. in fact, we are prohibited from influencing local instruction. we will have a better answer after we have the results from that 2011 assessment. host: thank you for your time on this weekend when we are reflecting on american history in our schools. guest: thank you.
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happy fourth of july to you. host: brief session of the house of representatives. pro forma session. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2010] . washington, d.c., july 1, 2011, i hereby appoint the honorable jeff landry to act as speaker pro tempore on this day, signed, john ample boehner, speaker of the house of representatives. the speaker pro tempore: the prayer will be offered by the guest chaplain, reverend william george, archdiocese of washington, d.c. the chaplain. almighty god, how wonderful is this country you've given us, the united states of america. we are grateful to be a nation under you, our god. without your goodness and love, what would we be? today we share freedoms you
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intended, beauty between two oceans that is beyond one's comprehension and talent. our children learn the laws of your universe in freedom to think and work at understanding your handi work. we can worship you however you inspire us. thank you for your love. the gift of our government, of the people, for the people, by the people, is special to us, the most diverse on earth. our house reflects your care for us, sensitive to the needs of all your children. fill each member with the grace of wise governance, its leaders with wisdom an insight to inspire the making of just laws. in this we pray to you, our loving god, amen. the speaker pro tempore: the chair has examined the journal of the last day's proceedings and announces to the house his approval thereof. pursuant to clause 1 of rule 1,
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the journal stands approved. the chair will lead the house in the pledge of allegiance. i pledge allegiance to the flag of the united states of america and to the republic for which it stands, one nation, under god, indivisible, with liberty and justice for all. the chair lays before the house a communication. the clerk: the honorable the speaker, house of representatives, sir, purr sune to the permission granted in clause 2h of rule 2 of the u.s. house of representatives, the clerk receives the following message from the secretary of the senate on june 29, 2011, at 5:45 p.m., that the senate passed senate 679, signed, sincerely, karen l. haas. the speaker pro tempore: pursuant to clause 4 of rule 1,
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the following enrolled bill was signed by speaker pro tell por rehairson on june 28, 2011. the clerk: to amend title 49 united states code to extend the airport improvement program and for other purposes. the speaker pro tempore: the chair lays before the house a communication. the clerk: the honorable the speaker, house of representatives, sir, pursuant to section 1k2 of house resolution 895, 110th congress and section 4c of house resolution 5111th congress, i transmit to you that canche burke, aborter goss, abner
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smitza, omar ashmali, mary kay flanagan, scott gaffe, gary hartzler, and nathaniel wright have signed an agreement to not be a candidate for the office of senator or representative in or delegate or resident commissioner to the congress for the purposes of the federal election campaign act of 1971 until at least three years after he or she is no longer a member of the board or staff of the office of congressional ethics. copies of the signed agreement shall be retained by the clerk of the house as part of the records of the house. should you have any questions, contact ronald dell thomas, signed sincerely, karen l. haas, secretary of the united states.
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the speaker pro tempore: without objection, when he house adjourned today, it shall adjourn to meet at 1:00 p.m. on nurs -- at 1:00 p.m. on tuesday, july 3, 2011, and further -- july 5,
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>> mark kelly, husband of that bill differed, is expected to be in attendance. it gets under way -- under at 1:00 p.m. eastern. >> at the political level, we are divided. >> the dow lama talks about religion, violence, -- dalai lama talks about religion and the death penalty. this monday, july 4, beginning at 10:00 p.m. eastern. for programs and times, go to c-
10:08 am this fourth of july 3-day weekend on american history tv, we will visit the smithsonian institute for american history. we will look at the smithsonian institution. laura bush on her time in the white house, planning her husband's presidential library, and her memoir. the former clinton press secretary discusses jfk's relationship with the press. get the complete we can schedule as news this morning from the associated press says a michigan senator will make a formal announcement about his
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presidential candidacy tomorrow. we have more from "road to the white house." the president was joined by the philadelphia mayor. president obama also attended a private fund-raiser at the home of a comcast executive. this is about 25 minutes. >> thank you, philadelphia. it is good to be back.
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[applause] it is good to be back in the great state of pennsylvania. congratulations, philly fans. that is quite a rotation. there are a couple of people i want to acknowledge. you just heard from somebody who i considered just a dear friend. this is a guy who stood with me when no one was sure whether i was going to win or not. he did not have to do it. he was just a terrific support it. he is a great senator. please give it up for bob casey. [applause] two other outstanding members of your congressional delegation
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who have been with me and support of of everything we have been trying to do. i could not be more proud of the work they do on behalf of their constituents. congressman brady. thank you. your outstanding mayor is in the house. [applause] and one of the great legislators in congress, who also happens to be a pretty good political mind. that is why we are so proud to have her as the chairwoman of the dnc. debbie wasserman schultz. please give her a big round of applause. [applause] i see a lot of new faces out here and i see a few faces i have known for a long time.
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some of you here in new me before i had gray hair. [laughter] >> you looked good though. [laughter] >> thank you. malia and sasha say it makes me look distinguished. michelle says it just makes me look old. she loves it, she just says it makes me look old. [laughter] being here with all of you i cannot help but think back to the election to one-half years ago and that night in grant park. it was the culmination of an extraordinary campaign that drew on the hard work of people all across america. men and women and some children.
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i did well with the eight and under demographic. men and women who believed the change was possible. they believe we did not have to accept politics as usual. they believed we could have a country that lived up to its finest aspirations. was a beautiful night. everybody was feeling pretty good. what i said that night, i said this is not to the end. this is just the beginning. the road we were on was going to be difficult. the climb was going to be steep. we did not know how steep it was going to be. we did not realize the magnitude of the recession we were facing and the financial crisis. we did not realize we had already lost 4 million jobs by
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the time i was sworn in. we knew it would be tough. that was ok. i did not run for president to do easy things. i ran for president to do hard things. [applause] i ran for president because it was time to do big things. [applause] we could not keep kicking the can down the road anymore. too much was at stake. we had to get started tackling the tough issues that families face each and every day. even if it would take time. [shouting from audience] >> listen -- thank you. [applause]
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let me tell you why i thought it was so important to run. even though michelle was not so sure. and why you guys got involved. i want everyone to remember. we ran because we believed in an economy that just did not work for those at the top, but for everybody. where prosperity was shared from the machine is on the line to be manager on the floor to the ceo in the board room. we ran because we knew our success was not determined by stock prices, but what the ordinary folks could find a good job that pays for a middle-class life. where they could pay the mortgage and take care of their kids and send their kids to college and save for retirement and maybe have a little left over to go to a movie or go to dinner once in a while. [applause]
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we ran because, for a decade, wages and incomes had a flat line. costs kept going up for everybody even though they didn't have any more income. that was before the economic crisis hit. once the economic crisis hit, we had to take a series of emergency steps to save this economy from collapse. not because we wanted to help banks or make sure the auto company ceo's were making good bonuses. we did it because we wanted to make sure the families could afford to take out a loan to buy a new house and start a new business. we wanted to make sure the people who depended on the auto industry would still have jobs. some of those decisions were tough. we got criticized a lot. take a look at what has happened.
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some folks did not want us getting involved in the auto industry. i did not expect to be the ceo of a car company when i ran for president. [laughter] as a consequence of what we did, we saved jobs. we saved american manufacturing. [applause] we cut taxes. we cut taxes for middle-class families. we ended subsidies for the banks or student loans to make college more affordable. that is why i signed a bill to make sure there was equal pay for equal work. i have two daughters. i want to make sure they are treated just the same. that is why we are promoting grownacturing, home r american manufacturing. those will lead to jobs that pay
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decent salary. i once solar panels and the electric cars to be built right here in america. -- i want solar panels and electric cars to be built right here in america. we are setting up a new consumer bureau with one responsibility -- looking out for ordinary people in the financial system so folks are not cheap. whether it is getting a credit card or a mortgage, you need to know if you are getting a fair deal. that is why we pass health reform -- [applause] so that nobody goes bankrupt when they get sick. we also had a long campaign in 2008 because we believe it was time to end the war in iraq. that is what we are doing. we have removed what a thousand troops from iraq.
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we are on track to remove the rest of the troops and bring them home by the end of the year. [applause] i ran for president because i believe we need to refocus our energy in afghanistan to go after al qaeda. we are going after al qaeda. we have taken out their leadership. because of our progress and the extraordinary sacrifice up our troops, we are propelling the commitment i made at the start to reduce our troops starting this month so that afghans can start taking responsibility for their own security and we can start rebuilding right here at home. [applause] it is time to start rebuilding here at home. it is time for nation-building right here.
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we live in a world where america is facing stiff competition for good jobs from rapidly growing nations like china, india, and brazil. for a long time, we were told that the best way to win that competition was to undermine consumer protection, undermine clean air and clean water laws, hand out tax breaks to millionaires and billionaires. that was the idea that helped for close to a decade. -- held sway or close to a decade. it did not work out very well. if you look at our history, it has never worked out real well. -- very well. america was built on the hard work and ingenuity of our people and our businesses. we also set up a free system of
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public schools. a generation was sent to college on the gi bill. we constructed roads and highways that span a continent and through investments in research and technology, we send a man to the moon. we launched the information age and created the internet. we created millions of jobs along the way. that is how you build a strong nation. that is how you build a strong middle class, by making the investments that are needed and always looking out over the horizon. we believe in business. we believe in free markets. we also believe in making sure every kid in this country has a chance. [applause] we believe our seniors deserve to retire with dignity and respect and have some sense of security. we believe in making investments in science and technology. we believe in having the best
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infrastructure in the world. so the same things that worked in the past, that is what we need to be doing today. there is an important debate in washington right now about how to cut the deficit. let me say, it is absolutely critical that we get a handle on our finances. we spent a lot of money that we do not have. we have made a lot of commitments. they will be hard to keep if we do nothing. like families all across america, government has to live within its means. i am prepared to bring our deficit down by trillions of dollars. that is with a t, trillions. [laughter] but i will not reduce our deficit by sacrificing our kid'' education. [applause]
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i am not going to reduce our deficit by eliminating medical research being done by our scientists. i would not sacrifice rebuilding our roads, bridges, airports. i want philadelphia to have the best, not the worst. not just roads and bridges and water systems. i want us to have the best broadband, the best electric grid. i am not going to sacrifice clean energy when our dependence on foreign oil is causing so many americans pain at the pump. that is sacrificing america's future. there is more than one way to mortgage our future. it would be irresponsible. we would be mortgaging our future if we do nothing about the deficit.
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we will also be mortgaging our future and it would be irresponsible if, in the process of reducing our deficit, we start a feisty bury things that allow us to grow and create -- we sacrifice the very things that allow us to grow and create jobs and invest in the future. what makes us great is the character of our people. we are rugged individualists. that is part of what makes us americans. we like to make up our own minds. we do not like people telling us what to do. what also makes us who we are is our faith in the future and our recognition that our future is shared. the belief that i am my brother's keeper and my sister's keeper. our country is stronger when everybody has a measure of
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security and everybody has a clear shot at the american dream. that is our vision of america. not a vision of a small america, but a vision of a big america, a compassionate america, an optimistic america, a bold america. [applause] that is what we are fighting for. and the good news is that america is possible. an america where we are living within our means and investing in our future. that is possible. where everybody is making sacrifices, but nobody bears the burden all by themselves. the idea that no matter what we look like, who we are, no matter if our ancestors came from ellis island or on a slave ship were crossed the rio grande, we are all collected -- all connected to one another and
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we rise and fall together. that is the idea at the heart of america. that is the idea at the heart of our last campaign. that is the idea at the heart of this campaign and that is why i will need your help more than ever. [applause] the campaign is at its early stages. i have a day job. [laughter] i have things to do. while i am working, there will be candidates parading around the country. [laughter] they are going to do what they do. they are going to attack. we are in philadelphia. they are going to attack. they won't have a plan. but they will attack. i understand that. that is politics as we have come to know it. what i also understand is that
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the american people are less interested in us attacking each other. they are more interested in us attacking the country's problems. [applause] they are less interested in hearing us exchanged insults about the past. they want us to exchange ideas about the future. that is the contest i am looking forward 2. i know that is the contest america needs. that is the contest we will win. [applause] in philadelphia, i know there are some of you who are frustrated that we have not gotten everything done that we said we would do in 2 1/2 years. it has only been 2 1/2 years. i have five and a half years more to go. [applause]
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there are times when i feel frustrated. but we knew this was not going to be easy. we knew there would be setbacks. there were setbacks during the first campaign. there will be times when we stumble. just like we stumbled during the first campaign. we knew that in each at every juncture in our history, when our future was on the line -- [cheers and chanting]
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what we also knew was that whenever the country has been at a crossroads, we have always come together to keep the american dream alive for the next generation. now is the time for us to do it again. now is the time to finish what we started and keep the dream alive. i want to remind everyone here that this campaign is not about me. it is about us. it is about students working their way through college, workers going to work as automobile companies, families that face hardships and setbacks who have not stopped believing in this country. they believe we can emerge from
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this challenge stronger than before. that is the story of progress in america, the stubborn refusal to accept anything less than the best that this country can be. if you are willing to keep fighting with me, if you are willing to knock on doors with me, if you are willing to get as much energy going as you did in 2008, together we are going to write a new chapter in that story. god bless you, philadelphia. yes we can. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2011]
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["ain't no stopping us now" playing]
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>> republican presidential candidate mitt romney was also on the road yesterday campaigning for the republican nomination. he was in allentown, pennsylvania to discuss economic issues. his remarks are about 10 minutes. >> this was the place president obama visited a year-and-a-half ago and indicated this was a symbol of the success of his stimulus program. as you look around and see the weeds growing and the windows boarded up, you can recognize it is a symbol of the failure of the -- of the obama economic
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policies. the plant here has been open 100 years. it survived the great depression. it could not survive the obama economy. the president says, give me more time. it could not have been worse for the people who worked at this plant. for them, it is as bad as it gets. you have 20 million americans out of work or dramatically under-employed. the president says, give him more time. three years he has been in office. this is the third year of his four-year term. he said, if i cannot turn the economy around in three years, mine is a one your proposition. i will collect on that promise. his is a one-year term unless the people feel the status quo is what they want more of. if people want change and they
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want not this as a symbol of hope, but a growing economy as a symbol of hope, we will have a change in washington and in the white house. with that, i am happy to take any questions you might have. >> if you were president in his situation with congress tried to figure out what to do with the deficit, how would you handle it? can you give us any specifics on what congress should do? >> let me start with number one. the first rule of any enterprise in trouble is to recognize it is in trouble. number two is to focus all of your energy in turning it around. the president also spoke this is on playing golf and campaigning. he should be focusing his energy
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on getting americans back to work and facing -- and fixing this economy. there is a big issue coming up regarding the debt ceiling. the president should not leave that out until he has an understanding of what it will take to get this economy go again and deal with it is the crisis. he is here raising money for a campaign. he does not even have a primary camp -- a primary component. he is going to raise $1 billion? focusing on getting americans back to work. that is where he should be spending his time. voters you assure that you will do a better job? >> i can assure voters that if i am president of the united states, i will spend every waking moment focusing my energy and passion on the economy and getting americans good jobs.
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secondly, i spent 25 years in the private sector. i know why jobs leave and i know why they come. i have seen success. i have seen the failure. i know how the economy works. the president is a nice guy. i know he is trying. he does not know how the economy works. he does not know what it takes to create jobs. government does not create jobs. it creates the environment that allows employers to employ. he has done everything wrong. increasing regulation. failure to execute a trade policies with other nations. the lack of an effective energy policy. the list goes on and on. he has failed in every dimension to create the certainty that allows entrepreneurs and employers to roll the economy. >> if you were president today, what would you tell congress to do specifically with regard to the debt and deficit?
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>> i would tell them to cut spending and put in place a cap on federal spending and to put in place a balanced budget amendment. >> if john mccain had been elected president in 2008, the think that plan would be in force? >> i certainly think so. if john mccain had come here and told people that this was a symbol of success, he would make sure that was true. the president said this was a symbol of hope. it is a symbol of spell your, fill up his economic policy. i say that -- it is a symbol of failure, failure of his economic policy. [inaudible]
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>> i did not say that things are worse. i said the economy has not turned around. you have 20 million americans out of work or seriously under- employed. you have a crisis of foreclosures in this country. if you think the economy is great and doing well, be my guest. the president of the united states, which he put in place his stimulus plan and borrow $787 billion and said he would hold unemployment below 8%, it has not been below 8% since. that is a failure. we have over 9% unemployment. he set the bar at 8%. that is a high number.
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he said it he could not get the economy turned around in three years, he would be a one-term president. it is not turned around. look around you. this is what he called the symbol of hope. he was the one who came here. i did not pick this by. he did. this is the spot he picked to symbolize the success of the stimulus. >> have you been tried to stay above the fray on the campaign trail? -- have you been trying to stay above the fray on the campaign trail? >> i am above the fray on the president's economic policies. can i win pennsylvania? pennsylvanian what good jobs. if i am president, i will do just that. my intent is to use a courier of work in the private sector and
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my understanding of how jobs come and go to try to help america become the most attractive place for investors, or innovators, for laborers. i want america to go back to work. [inaudible] >> i am not familiar with the specific bill. i like free trade agreements. i do not know the specific questions that the republicans have with regard to the bill. there are a lot of republicans in washington. my own experience in dealing with the serious issue of people whose careers have been lost because industries have been lost is that in some respects, the best way to help those folks is to attach a bit of a bonus or a bounty to those who have been unemployed for some
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time and let that money goes to someone who actually hires them and puts them in a training program in their enterprise. i like people getting trained for actual jobs. we did that in my state. there was a bonus attached to anybody who had been unemployed for one year or more. i like helping individuals who have been out of work for a long time, who is industries have been decimated and helping those folks get the kind of skills doing something that makes a lot of sense. >> c-span has launched a new website for politics in the 2012 presidential race. --i'll try -- put your feet from candidates and political importers and links to media partners in the early primary and caucus states.
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tune in to c-span on this independence day. we discussed with the united states can remain united. >> at the political level, we are more divided. >> the dalai lama talks about religion, violence, and the death penalty. and a discussion of the president's foreign-policy. for the complete schedule of programs and times, go to c- this fourth of july 3-day weekend on american history keep the on c-span 3, we will visit the smithsonian museum of natural history. we will look at 40 tons of specimens that became the foundation of the smithsonian institution. laura bush on her time in the
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white house, planning her husband's presidential library spoken fromoir, " the heart." get the complete we can schedule act later today, we will bring you remarks from the nasa administrator. he will talk about what is ahead for the industry. mark kelly is also expected to be in attendance. it gets underway at 1:00 p.m. eastern. you are watching c-span, the new politics and public affairs. every morning, it is "washington journal," connecting you with policy makers and journalists. also, supreme court oral arguments. on the weekends, you can see
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our programs, "newsmakers," and "the communicators." c-span, washington your way. a public service created by america's cable companies. yesterday, a senate judiciary subcommittee examining a report on the fraud enforcement task force. the task force is led by the justice department and includes 25 agencies. witnesses included beat executive director of the task force and the u.s. attorney for the district of minnesota. amy klobuchar is the chair of this hearing.
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>> mortgage fraud caused many americans to end up in homes they could not afford, which helped lead to be an act to crisis and recession. we saw that in my home state -- helped lead to the financial crisis and recession. there were loans taken out from people who did not have the best
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interests in mind. fraud on government programs can undermine and diminish the benefit of crucial public investments at a time where you have senior citizens who can barely afford health care. he thought that there are storefronts set up where people are receiving medicare checks that they do not deserve and do not qualify for can make anyone want to scream. the idea is to cut back on that and do something about fraud. that is what the task force is about. fraud on medicare and medicaid has cost the government billions of dollars. in the investment wrong, we have seen what criminals like bernie met -- in the investment realm, we have seen what criminals like bernie madoff can do.
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it is important that our anti- rod that this be effective. -- that our anti-fraud laws be affected. we need to have the necessary laws in place to deter this kind of thougfraud. we must promote the public awareness of the dangers of financial fraud. it has always been my experience when i was the captain attorney that when there was a major fraud committed, the citizens did not care who was prosecut ing. they just wanted us to get the job done. these crooks do not respect boundaries. they do not care if we are doing
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something in another country or another state. we need to be as sophisticated as the crooks who are breaking the laws. president obama form to be financial fraud task force in 2009. it includes u.s. attorney's offices, the national association of attorneys general. it is important that local prosecutors be represented. so many crimes since 9/11 when the u.s. attorney's office is focused on terrorist crimes, so many white-collar crimes like crimes involving millions and millions of dollars were handled on the county level by local prosecutors, by the district attorney's office. they need to be a part of the task force. the task force seeks to harness the capabilities of its member
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agencies and to work on fraud enforcement peppers. it includes securities, -- and to work on fraud enforcement efforts. the agency can out with its first report and we will examine that report today. there are anti-fraud efforts at the justice department. we have with us today two expert representatives of the task force. we have todd jones. he brings a lot of experience to the job and to our state. we also have robb adkins.
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i will give a more complete introduction of our witnesses before they testify. i see we have been joined by senator grassley of iowa. >> thank you, madam chairwoman. thank you for having this hearing. and demonstrating your leadership in the area of comeback thing financial -- of combating financial fraud and something that undermines the integrity and trust of the public in our financial system. these crimes are more than just superficial or passing in their impact. they are enduring because they go to the core of what people trust and need to have confidence in. i want to begin by saying i have
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reviewed the task force's first your report, which outlined increased prosecutions and convictions associated with mortgage fraud. those developments are positive. i want to commend your efforts in this area. twice as many defendants were charged in mortgage fraud and twice as many people were sentenced at every level. that is good news in sending a message, a deterrent message about the sincerity and seriousness of this administration in dealing with this kind of crime. the 533 defendants found guilty of mortgage fraud last year is a dramatic increase. i think everyone here and both
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of you being experienced and prosecutors agreed that the magnitude of what needs to be done is daunting and important. that is partly why we are here today, to make sure the progress continues. and also to make sure the public understands the difficulty in doing these cases. that is the second point i want to make here. you have amassed an infrastructure and cooperation that is necessary in addressing these problems going forward. these cases are not like the bank robbery is we used to do when i was a united states attorney in connecticut. they were simple cases. we moved to white-collar fraud,
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which was more demanding. the kind of cases you are investigating and prosecuting are much more demanding and difficult to investigate and prosecute. you need not only dedicated and skilled professionals, which we have always had in the fbi and the u.s. attorney's office, but individuals who are schooled and trained in the kind of investigations that need to be done. i want to thank you so far. i look forward to working with you and cooperating with you and aiding you in minnesota, where i know you are doing great work and bringing together the kind of resources we need on mortgage fraud and the gasoline price spikes we have seen and crimes
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related to them. i have advocated more aggressive action in that area. i look forward to working with you today. >> thank you very much. senator chuck grassley from the state of iowa. >> i congratulate you on this subcommittee. when i was the chair in the 1980's, we established a record that was able to help us get a bill passed that has brought $28 billion back into the federal treasury. >> they are big shoes to walk in. >> today's hearing allows us to conduct oversight into it just brought against american taxpayers -- address fraud against american taxpayers. most recently, this committee
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held a hearing on fraud enforcement efforts. we just received responses to our written questions last night after 5:00 p.m., five months after the questions were submitted. i am glad the justice department was able to get answers to these questions and return them to the committee, it is daunting to get them after 5:00 p.m. the day before the next hearing on the same subject. senator leahy and i introduced introduced a legislation bill to protect taxpayers. in fraudonsia cyst protection. the committee reported the bill
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by a strong bipartisan voted. the bill addresses important legislative changes. important work remains. this hearing is part of that continuing work. by conducting continuing oversight, we can ensure that the justice department is attacking fraud aggressively on behalf of our taxpayers. this is important. understanding be significant expenditures of taxpayers' dollars, president obamas signed an executive order creating the financial fraud enforcement tax force. -- task force.
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the task force will investigate and prosecute significant financial crimes related to the current financial crisis and economic recovery efforts. that is the end of a " bank about the establishment of the task force. -- end of a quote about the establishment of the task force. we will not just hold accountable those who helped bring about the last financial meltdown, but to prevent another meltdown from happening. while i appreciate the attorney general's comment on the task force. know if it is achieving the stated goals of the president and the attorney general. in washington, task forces and commissions are created to make people think they are doing more than they actually are. it is a way for public servants
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to tell the american people they are addressing a problem when nothing really changes. i want to hear from the witnesses called the task force has furthered the fight. the task force is made up of a steering committee made up of the deputy attorney general. there is an information sharing committee. there are also five separate working groups within the task force. each of those separate working groups has no less than three participating federal agencies. this is a time that could be spent investigating and bringing prosecutions. i want to hear some specific examples of how this has added value and not simply facilitated more bureaucratic processes to combat fraud. i am also concerned that the
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task force may be a press release collection agency to collect examples of prosecutions. my staff has heard this specific accusation from agents and attorneys in the field. i would like to learn a bit more about why the task force is necessary and white taxpayer dollars are used to facilitate meetings -- and why >> thank you, senator grassley. can the witness is please stand to be sworn. to you from the testimony you are about to give before the committee will be the truth, the whole truth, and nothing but the truth, so help you god? >> i do. >> thank you. we are pleased to be joined today by b. todd jones, of u.s. attorney for the state of minnesota. he served on the steering
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committee of the task force and chairs the attorney general's advisory committee as u.s. attorney. mr. johnson served as the u.s. attorney for minnesota, 1998 to 2001 and served on active duty with the united states marine corps from 1983 to to 1989 and again in 1991 during operation desert storm. the graduated from mcallister college in 1979 and university of minnesota law school pin 1983. when i was the county attorney, the d.a. in minnesota, he and i worked extensively together. mr. robb adkins will be happy to know that the b. todd jones and i went together once to the white house, my first visit to the white house. i did not even been on a tour for. we were invited in to talk about the introduction of a crime bill, a hate crimes bill. during the speeches where president clinton and i spoke, i
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mentioned a couple b. todd jones and i said, mr. president, we worked so well together, we talk on the phone nearly every day. in the next day i got home and it was a saturday and i got a phone call from b. todd jones and i asked why he was calling me on a saturday. he said you told the president of the united states that we talk on the phone nearly every day. if he's truly an honest man. next we have robb adkins, executive director of the task force since the great 2010. mr. atkins became a federal prosecutor in 2001 and was named to keep of the u.s. attorney's office in santa ana, california, in 2007. the recipient of the attorney general's award for special observance, the highest commendation in the department of justice and was once named as one of the top 20 lawyers in california under the age of 40. he graduated from stanford university and the georgetown
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university law center. mr. atkins, i understand you are leaving the task force in july. i'd thank you for your tireless work. you have done a tremendous job in combating fraud. i wanted to make sure we thank you for your service over the last year-and-a-half as well as your time as a prosecutor. i look forward to hearing more about your work with the task force. mr. jones, if you would like to begin. >> thank you. good morning, madam chair, senator grassley, a troubled and doll. it's a privileged to be with you today here. the financial crisis has impacted virtually every american across the country in some way. the underlying cause of the financial fraud enforcement task force is to address that crisis with an equally comprehensive response. senator klobuchar you have party spoke about and i know you understand about you of collaboration. 12 years ago when we worked together on a number of issues of mutual concern including fraud,, when you were the county attorney and i had the privilege
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of serving as the u.s. attorney, the importance of collaboration was always at the forefront. as we learned then and we know now, different partners, law- enforcement partners, have different resources. they have different tools in their box. the overall goal of effective law enforcement is to bring everything we have collectively to bear on the issues at hand. that is what this multi agency task force is about. operational traditional task force. we have task force like that all across the country, composed of the agents and prosecutors working every day,, making cases across the country. this task force operates at the 30,000 foot level, providing coronation and training, sharing information and expertise, among all the partners who are all on the same side working toward the same goal. the president greeted the task force in november of 2009.
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it is composed of more than 25 federal agencies as well as state and local partners. it's one, of the largest collections ever brought to bear up when confronting fraud. it is chaired by the attorney general of the united states and includes the criminal and civil divisions, of department of justice as well as all 94 united states attorney offices. but this is not just a doj initiative. taskforce includes the department of treasury, hud, commerce, homeland security, numerous federal inspectors general, the fdic, ftc, irs, special inspector general for tarp, as well as numerous attorneys general. the executive order directs us to use the full criminal and civil enforcement resources of all these different agencies to do five things.
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first, investigate and prosecute. second, recover a criminal proceeds. third, address discrimination and we did in the lending and financial markets. fourth, and and coordination among federal, state, and a local authority. last, to conduct training and outreach to republican. as chairman ka of the attorney general's advisory committee, i am honored to serve on the steering committee along with representatives from the other agencies. however, if a bill leadership of this group extends beyond the beltway. however, the leadership of the group extends beyond the beltway. on the west coast, the mortgage fraud working group is co- chaired by another one of my colleagues, u.s. attorney ben widener in the eastern district of california. he knows firsthand the impact of
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the mortgage crisis because his district has one of the highest foreclosure rates in the country. ben wagoner. he chairs that group with representatives from our civil division in washington, the fbi, hu-iog, and the national association of attorneys general's-- hud-oig. the task force has equipped its network with mortals and better- trained personnel by compiling and distributing their resource guide of financial databases and information is important, holding national training conferences, causing a website with fraud reporting and distributing information about emerging from uptrends. i know first hand the value, of having this kind of individual in the offices. we can rely on our fraud
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coordinators to wire them and in nationally in a way that has not really occurred before with all the best practices and provides a government wide network that has the complete alphabet soup of financial regulators at their disposal. many of those agencies, my folks never worked with before. i see my time is running out. i will pass it off to robb adkins and look forward to addressing any questions you have. thank you. >> thank you, mr. atkins. >> good morning, chairman and distinguished members of the subcommittee. it's a privilege to appear before you today to talk about the financial fraud enforcement task force and are continuing fight to address fraud. i am honored to appear before you today with b. todd jones, u.s. attorney for minnesota, who is a national leader of this effort on the task force and is also a national example to the fraud enforcement that he does in his home district in minnesota. as u.s. attorney john described,
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the task force has a broad membership and mandates focused on the solar array of financial fraud. that includes mortgage fraud, fraud, securities and commodities fraud, it also includes those efforts that are designed to help the economy recover. and to address those who would seek to defraud those efforts around the country. as more fully detailed in the task force annual report which the chairman described, there are many ways in which the task force has been very successful within its first year. i want to highlight a few of them and then discuss more them with you. as senator grassley correctly noted, the task force is very broad. that comes with a challenges. it also comes with strength. one of the great strengths of the task force is training and information sharing, which is critical to unlocking the strengths from such a large coalition. in pursuit of that goal, the
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training information sharing committee has been active in its first year. it's brought together financial fraud coordinators including one in b. todd jones's district to a national training in october of 2010, bringing together a robust set of white collar professionals from around the rends ando discuss transpor how to move for. and mortgage fraud is a broader array of fraud. from loan origination fraud to reverse mortgages to short sale schemes and foreclosure rescue scams. a wide array of scams are addressed. mortgage fraud trends show that the fraud varies with the housing market and varies with geographic regions. i have seen in concrete ways how collaboration has led to better
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enforcement. for example, at the summits, representatives combine their datasets in order to produce essentially a target list of individuals engaging potentially in fraud. this serves a valuable purpose to those in the field with one of the great challenges they face in addressing mortgage fraud is the great prevalence of day --. it allows them to get the best bang for their buck in terms of where to focus the resources to address the problem and to target that in an efficient way. another focus for the task force is potential fraud, waste, and abuse and recovery of funds. because the task force was established at a time when the stimulus funds were still at the stage they were being distributed, much of the work of that working group has focused on fraud prevention and detection. at the close of 2010, more than 100,000 professionals
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responsible for awarding and overseeing recovery act and disbursements as well as investigators, prosecutors, and agents were trained as part of this effort, which we believe is one of the largest fraud prevention training efforts in history. the task force is similarly focused on efforts to combat fraud, waste, and abuse with respect to the tar program. it engaged in successful efforts to partner the special inspector general approach t arp program with u.s. inspector general programs across the country and there have been good results. they have brought cases including a park avenue bank, which was the first conviction of an individual attempting to defraud tarp of $11 million. another working group of the task force focus is on securities, commodities, an investment fraud. it brings together a broader array of impressive subject matter experts as described by u.s. attorney jones. in its first year the working
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group members conducted workshops on important issues offsets the dodd-frank wall street reform plan and consumer protection act, investigations and prosecutions of investment fraud schemes and parallel criminal and civil procedures. during 2010 working group members in this event prosecuted numerous securities and commodities fraud involving if large complex cases against executives of the highest levels. example, a different task force members including criminal division u.s. attorney in the eastern district of new york, as well as tarp, start lee badly -- charged a man for fatah $2.9 million that contributed to the figures of one of the 25 largest banks in the united states, one of the largest privately held lending company security was convicted of all counts in april 2011 and is scheduled to be sentenced this morning in the eastern district of virginia. last and not least, the task
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force believes we cannot prosecute our way out of this crisis. public outreach, consumer financial literacy, and assisting those to prevent themselves from being victimized is important. we have an on-line consumer base-website: i look forward to any questions. >> people have learned since 9/11 the importance of exchanging information and having people aware of stuff. whether it is a terrorist network or white collar crime in the united states. tried toig fan of c exchange information and get after some sophisticated cracks -- crooks. center bluemont bol is important and senator grassley accounts the money. -- senator blumenthal is
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important and senator grassley counts the money. according to to the first-year report of the task force, the number of mortgage fraud prosecutions went up significantly in the first year of the task force. i know it's hard to quantify the precise impact of the task force, but generally speaking, how has the existence of the task force helped to increase the number of prosecutions? >> thank you. my background is also as a federal prosecutor. i am well aware that prosecutions occur at the end line level throughout the country. in the u.s. attorney's office is and field offices of the fbi and elsewhere. you are correct. the task force, as mr. jones mentioned, is designed to help them. to support them in the cases that they bring, as an overarching agency that we duplicate their efforts rather to help enable them through
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cooperation, information sharing, training, and coordination. the information sharing effort and the training efforts in a mortgage fraud arena are very important. i don't think that you should look to the increase in mortgage fraud prosecutions and say that those were directly caused each and everyone by the task force, because that's not the model. it is a measure of success. we want to get out there not just criminally, although that is important because its the most valuable deterrent you can have, but also with respect to other tools that we can use. as you saw an annual reports, if one of the great success stories of the task force has been bringing together some of these other entities that previously had not been as coordinated or brought into the fight in mortgage fraud. talking about state attorneys general working very closely with u.s. bank trustees, with the ftc, with the fbi and the
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u.s. attorney's office is. and even within the department of justice, not as criminal prosecution, but very important civil enforcement that can be brought here not to the exclusion of criminal cases, but to complement that. we cannot simply prosecute all these cases away. we need to bring every tool we have. the civic things the task force has done in addition to the targeted data compilation i described earlier, which is very valuable to the field, we have taken that show on the road to those areas that are hardest hit around the country in mortgage fraud, in order to interface with 94 different mortgage fraud working groups and task forces at the operational level so that we can get data from d.c.. it does not always get to the field directly into their hands to assist with prosecution. >> can you tell me about operation broken trust? >> operation broken trust is an effort in december of 2010. one of the issues that we heard
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when the financial fraud coordinators came together in october of last year was there is an incorrect perception that investment schemes such as ponzi schemes and the like, often called affinity fraud, which rely on a level of trust, but there is an incorrect perception that when the economic tides receded, and left flopping fish on the beat. by that i mean upon the scenes amount, such as those of bernard madoff, and that there are no such schemes occurring today. that is incorrect. we want to draw a focus on that to get into the hands of potential victims but even current victims who could report fraud. it's an increasing problem, especially as people potentially to publicly traded markets and look for other ways to invest their money. so we put together a snapshot, a
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window of three months up to four months to find out how prevalent it was and to get the message out. starling results. 120,000 victims in cases brought during that time. -- startling results. it's part of the outreach, the effort to reach the public. we know we cannot prosecute our way out of this. we need help public's. >> we prosecuted some people for tax fraud. people see examples. millions and millions of dollars, payton to the treasury suddenly and in minnesota because other people that might have been engaging in schemes that we did not have the information on suddenly decided approve pay. it can have not only the prevention of fraud but it can help physically better than any other area i can think of, when you show the example that you are willing to put people in jail. u.s. attorney jones, could you just talk about some examples from the front line in
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minnesota, some of the white- collar cases that have been particularly successful and tom in millions of dollars they involved? -- and how many millions? >> we have been busy on the fraud front, as have many of my colleagues. it's not always obvious. dust as senator grassley is concerned about slapping a label on a credit police and taking credit for work that really is not related to the financial fraud enforcement task force is a misplaced notion. a lot of this work is in the pipeline. anyone that has been out in offices, know that these cases are complicated. they take time. and so, we have a full list of the pipeline of fraud cases, many of which are generated by the increased focus and the collaboration and coordination going on right now as a result of the financial fraud enforcement task force efforts. >> can you give me examples of
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one' that have been finalized? >> you know we have people in jail from the district of minnesota. thomas petter. he's the ceo of a corporation that was involved in a massive ponzi scheme, $3.5 million ponzi scheme. within a period of 18 months we went from an fbi/irs investigation to a full-blown trial to a sentencing in april of last year where he received the largest fraud sentence ever of of 50 years. now he's in the custody of the bureau of prisons in fort leavenworth there that was all done in 18 months. more recently, to get to the point of this collaboration going on, trevor cook, a person involved in foreign exchange, --t we worked that whippingcf worked with ftc.
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we haven't got what we could for the victims of his fraud. those are two examples for minnesota, but that has been replicated across the country. >-- we didn't ask what we could for the victims of his fraud. >> thank you. senator grassley. >> this task force was created in 2009. we rode defraud recovery act in 2009, deadlock in may of 2009. -- we wrote the fraud recovery act. it was signed into law in may of 2009. combating fraud was on the radar
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before the task force. regardless of the existence of the task force, fraud-related crime was being investigated and prosecuted. consequently, it's difficult to determine exactly what investigations and prosecutions are directly attributable to the task force. from mr. atkins, i would like to have you answer these questions. they're not accusatory, they are just trying to get some information. how does the task force determine what cases were investigated and prosecuted as a direct result of the task force? and then i will have a couple other questions. >> thank you, senator grassley. i do want to thank you, also, as well as senator pat leahy. hopefully, later i will have an opportunity to talk about how directly extension of financial institution definition to non- bank lenders is a direct affect
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between nine and one of the policy proposals that went to the task force policy committee since then has put out as a rule, which is to extend suspicious activity reporting not just to financial institutions, but to extend to the non-banking lenders. if your question is a good question. my background and my personal view of the task force is that we need to support the agents in the field as well as the non- doj and fbi agents. the way we determine which efforts and press releases and announcements that we highlight through the task force is dependent upon the executive order, which we have filtered into different working groups. you mentioned earlier correctly that there can be some democracy -- bureaucracy involved in such a broad effort to pare the working groups are trying to address that. so mortgage fraud, securities and commodities fraud, recovery
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act fraud, which relates to procurements and grant fraud in the recovery act area, tarp fraud, and certain nondiscrimination cases. those are the areas that the task force has prioritized to the executive order. those are the areas we coordinate with the financial fraud coordinators and the areas we tried to highlight and push- out to get the maximum deterrent value. >> if you can answer this question, how often do the debt and working groups of the task force meeting? >> that is hard to answer. it depends on the working group. for some of them, like the securities and commodities fraud working group, which is a man from the southern district of new york and others, each of them host meetings in a rotating basis. the last one was hosted by ftc
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in new york a couple weeks ago. that group, because of its size -- and as you noted, we did not start prosecuting fraud in november 2009. that is a group that's been working together for quite some time. they need typically two months to three months, but they have individuals at a lower level within the organization that i interface with on a weekly basis offline outside of the more formalized groups. i found that to be very productive. there are groups that meet much more regularly. in the mortgage fraud working group they have meetings, but they also have summits around the country. they have subgroups that get together on particular issues. some of them meet on a more regular basis every few months and others need much more frequently. >> we have the press releases that i have referred to. we have an annual report that i characterize as a summer station of the press releases.
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--summarization. >> we put together a compilation of the different fraud and databases, fraud enforcement databases. this had not been done, surprisingly, previously. amongst the alphabet soup of the federal enforcement family there exist many different types of data sets. we put together a resource guide and got it out to the field through the financial fraud coordinators, allowing those and the level to get around the bureaucratic response -- allowing those at the line level to get around the bureaucratic response. we have put forth two separate bulletin's that go out, a
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resource and training guide for the field describing the ways in which to confront particular difficult problems, including mortgage fraud and some of the other is that we have discussed. >> i have a series of questions. i will not get to all of them. i would like to get a handle on budget and financial control. according to your written testimony and the task force annual report, the mortgage fraud working group has held regional summits around the country, including miami, detroit, phoenix, columbus, fresno, los angeles. further testimony discusses training of attorneys and agents at the national efficacy center. your testimony also described training. nowhere in annual reports were -- indoor sports was there
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discussion of tax dollars expanded to fulfill the task force functions. i am concerned by not having a formal budget expenditure for travel to be on this. the executive order creating a task force is expected, but should provide funding for the task force -- the department should provide funding for the task force subject to availability. >> i don't know that there's a separate budget for the task force. i'd think the reason for that is the task force model. the task force, i think, would be poorly served if it attempted to especially put in place an agency structure that would be duplicative of efforts already ongoing. the task force model of is one in which we enable those who already are the experts -- they know how to prosecute the cases and regulates certain markets,
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but to put them in places and to coopt some of the efforts that are ongoing. take one part of the federal family and put it in touch with another. take folks at the state level and bring them in so they can work better. you mentioned a national advocacy center, that was originally planned -- there had been several training that we're going to occur anyway. we made them better. we brought in the special inspector general ups tarp -- of tarp so they could see a broader array of fraud resources they can use in their everyday lives out in the field. that is the model. it's not so much to always create, but to use the resources individuals sod theh we can better use the state funding. >> i will stop for now. >> thank you very much, senator grassley.
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senator blumenthal? >> bank unit. i have questions focused particularly on gasoline prices and the commodities markets that are related to fuel and soon heating oil. even though now it's pretty warm outside, that will be pressing topic pretty soon. as you know, the national average is near $4 a gallon. to be specific, i think it's about $3.64 a gallon. its $3.94 aut's gallon, which is much higher than it's been. it cannot ask fully be explained by supply and demand. and a creeping down in the prices after developments and actions by the administration and other law enforcement
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substantiates my view that speculation and possibly political manipulation of the is to blame, at least to some extent. i welcomed and applauded the decision to create the oil and gas price task force. i commend the federal trade commission in initiating an investigation into the fraud and manipulation relating to gas prices at every level of industry. so far, i note with some regret the department of justice has not announced any such investigation. so my question is, can you tell us whether the department of justice has initiated any actual civil or criminal fraud investigation into a potentially illegal speculative
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activity in the futures markets or any other markets fuel? >> bank agreed oil and gas from a working group, which was established months ago, -- the oil and gas fraud working group was established months ago. i will admit that oil and gas price fraud is not something that's part of my personal background as a prosecutor, so it has been a learning experience for me, which is a good thing. ftc, as is my understanding, and i've seen the announcement about their investigation into potential pad anti-competitive or manipulative behavior. the department does not announce
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investigations, if there are any. we are not in a position now to announce if there are any investigations. we typically speak when we charge or act. i can tell you the department is fully engaged in that effort. different components, including the antitrust division, is fully engaged. i'd think we are playing a valuable role, especially in terms of the interface between the federal family and the state attorneys general who have flexible cord in this area. >> let me suggest that the role as i understand it is the department of justice does not announce investigations, but sometimes particularly the antitrust division makes known its interests and in fact makes and on its investigations. the very powerful effect of the
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announced action so far in bringing down prices and convincing speculator is that they are on the wrong side of history, on the wrong side of the market, on the wrong side of the best they're making is a benefit to the public. in fact, what we have seen is a statement excess speculation is at an all-time high, a collective positions are 64% higher since june of 2008. all the indicators are there to show an investigation by the antitrust division or somme part of the department of justice is appropriate and necessary. i understand that your task
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force is looking at this. from the 30,000 foot level, he has the authority and responsibility to drop the investigations at the 1-foot level at the department of justice, which is where they should be different. >> i appreciate that. i think i could repeat what the attorney general has said in this area, which is we are very aware of itself, we are looking into it, we have brought all the components, agencies and regulators, together, so we can look it issued to pursue any fraud as it occurs. while we understand there can be legitimate market forces that change prices of gas or any other commodity, that is an area of concern where we want to make sure we are doing all we can to bring the folks together to make sure we are focused on exactly the issue you that you raised. >> was the position that there houldn't position limits --
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it's your opinion on that there should be position limits? position limits will help diminish the power of speculators to corner the supply in certain areas. i believe strongly that we should have those limits as soon as possible. >> i would have to defer to my much more sophisticated colleagues at cftc and elsewhere. while i prosecuted some commodities fraud cases, this has been a learning experience for me. >> if i would like to request from the task force that it to give us a position on whether there should be a position limits and what other measures and steps the commodities futures trading corporation should take, because i believe it is part of your task force, is it not? >> correct, and a part of this individual working group. >> i would request that the task
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force provide the committee with a position on that issue. >> thank you. i will bring that back to them. i appreciate your interest in the area. >> thank you. and thank you both for your very good work. >> thank you. >> senator grassley. >> thank you, madam chairman, for inviting me to go ahead in the second round. i would like to continue with mr. atkins along the budget line. you dance to the first questions as well as you could because of the purpose of the task force. -- you have answered the first questions as well as you could. from what appropriated funds utilized to fund the activities of the task force? >> i don't know the answer to that question. >> then let's leave it. you could answer that in writing. >> very well, thank you. >> let me go on.
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is official travel authorized for any of these meetings? if so, is there a separate budget for the travel? officialt believe travel is authorized. you have components within doj, the antitrust division, the civil division, the civil rights division, the criminal division, the executive operas of the u.s. attorney's, 94 different u.s. attorney's offices. i don't know exactly how doj handles that. i surmise that they do with the official travel. oftentimes they have to existing facilities and we tried to use resources and dedicated personnel for people already in the region presents us at those types of events. but of course there is official travel and costs associated with those efforts. oftentimes it is a replacement for other efforts that were going to be had, but not on such a broad and collective level.
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we are really bringing together individuals who might be trying to strike out on their own in some of these efforts and to do it in a comprehensive way with a bigger target audience and a better way of pushing it out to the field. >> you might not have information for few other questions. i will turn those in to you and let you ask those in writing. if i could go to mr. jones, president obama's stimulus program had a lot of taxpayers' money into it for various projects and programs across the country. the recovery accountability and transparency board was created as part of a lot to oversee how the funds were spent, to ensure they were not subject to fraud, waste, and abuse. the recovery board, various inspectors general, example of
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six grantees and others abusing recovery act dollars. was a significant fraud in the department of energy weather is asian program for homes -- in the department of energy home weatherization program. the board is made up of all the inspector general's of each agency, why wasn't its aborted recovery act funds? awarded recovery act funds? >> more than a 50,000 officials and nearly 400 agents and auditors have been spun up through our training program, through the information sharing to investigate this fraud.
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this grant and procurement fraud is something that we would do and be engaged in any way. citing what the working group does, as does the financial fraud enforcement task force, it allows us to leverage our resources in a more focused way. that will shift over time. we expect recovery and training package, the investigators and auditors, what they gonna in training will be of use in alabama as a start to get resources to rebuild after the tragedy there with the tornado. and any place else that there are fema funds or other federal dollars gone into an area. this training lasts forever. it will live beyond the financial fraud enforcement task force existence. >> my last question will start with the first-year report from the task force. "the establishment of the working group last year added
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the full weight of law enforcement community behind the recovery board's efforts." as a u.s. attorney out there in the field working very much on the front lines to prosecute fraud, regardless of the existence of the recovery act working group, would not the full weight of law enforcement already be behind investigating and punishing those who commit recovery act-related fraud. if not, then why not? >> in minnesota where we are, we have been keeping an eye on it. from a practical standpoint, the one thing that the financial fraud enforcement task force has done has really been to enhance communication between our offices and the ig's. and the fbi.ig's its enhance our communication between ig and the civil division. that's true at many u.s.
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attorney's offices. we have done a lot of work on a false claim cases. i'd think you understand the importance of the civil passed a of the work we do in our offices to recover money from people who should not get that money or who had committed fraud against the government. many u.s. attorney offices have enhanced the resources that they have put on affirmative civil enforcement. >> mr. atkins, let me finish with you on this budget item. that't necessarily agree the task force should not have a budget, but i wonder if it would not speaking or rather i guess i would like to ask you if you commit to putting together a budget for all the activities and operations of the task force, including specifically the budget line items for travel conferences and training
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materials. would that not be useful? >> interesting question. i think it's one we would be happy to explore with you. anyway we can improve our trade on the task force is something we can embrace. there could be some difficulty with it once you get outside the department of a justice. most of my time is spent with relationship greeted more than 60% of the time, dealing with federal agencies, more so ban the state level. it becomes difficult to track because it's difficult than the other task forces difficultenron. this is different. -- different than other task enron.tlike i could certainly work on that with you. >> mr. atkins, how would you
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describe the level of fraud that seems to have occurred? with respect to recovery act funds? is the level as much as people anticipated, given how much money is at stake? >> it's always hard to know. there have been hundreds of millions of dollars in recovery act funds that have gone out. the level of fraud is very low in correlation to that. that's not to say there won't be any. but i think that great credit is deserving for the recovery accountability and transparency board. to determine. as well as today ig's around the country and to the historic training effort that's taken place. we never would be a book to tell, would fraud have occurred but for the training. i believe it has had a great effect. i believe that working group has brought in -- the national
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procurement fraud task force was somewhat recently brought into their recovery fraud working group. that was done because there was some duplication and great leadership at they ig level that we want to bring to bear so that we are poised to address fraud when it occurs and to try to prevent this from happening in the first place. >> as we look at potential legislation, senator grassley mentions a bill that we have to try to get more resources through fines redirected into the white collar fraud area, can you think of any legislation that would be helpful not only to the task force, but to you and your efforts to prosecute white-collar crime and fraud crimes? >> senator, as you know, the department, particularly the
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office of legislative affairs and the criminal division, as a routine contact with your staff, the committee on judiciary. we have on occasion seen proposals for legislative fixes, nothing particular comes to mind beyond some of the things that are the result of supreme court cases. but i know that there's a package of proposed legislation that the criminal division has worked on with your staff and with senator pat leahy. nothing in particular comes to mind. i will not get myself into trouble by suggesting something. [laughter] >> i am sure we have some ideas. thinking back to when you were u.s. attorney, when was backs? >> 90 aitken's-2001. -- 1998-2001. >> what the defense in the types of white collar crimes we are seeing now and the approach are devastating to those crimes?
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>> three things. the evolution of the fbi has been absolutely amazing in 10 years. to be an intelligence dast based -- and intelligence-based agency. things they've done on the national security front as well. they lost capacity because of the substantial core of the district pases a main partner on fraud investigations somewhat diminishing because of the resource issue. but that is also allowing us to do some things with the irs and with the ig and to look at civil enforcement on the fraud front. >> after 9/11, colorado likes of /11, some ofer 9:0 the focus was put on terrorism. >> the volume of information is
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another thing i've seen. volume of information that's out there because of technology and the use of the internet as a platform to commit fraud. >> over the last 10 years? >> over the last 10 years. the internet was emerging as a criminal platform when i left, but it's much more enhanced now. it creates a lot of challenges with detecting fraud, with identity theft, and with anonymity for criminals globally to try to track down individuals that are accountable for perpetrating fraud. that is a challenge that we are trying our best to address. >> very good. in terms of the work with the department of justice through the task force and others, and for coordinating? -- has that been enhanced? >> in my opinion, it has.
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enron was very driven by doj, people sitting around a table and talking great thoughts and great plans, but this is very much one because it is such a collection of 25 federal agencies and because it includes a lot of outside of the department of justice agencies at an operational level, the ig's and auditors and the people that will actually generate cases, makes this one, gives it some sustainability because it's adaptable to emerging trends like oil and gas. and it also allows us to have some continuity with operators they're learning from each other. that has been probably the biggest benefit that i have seen from " the u.s. attorney's office perspective. it's information sharing that goes on. not only are we doing cases in our district. we are also now sharing the lessons -- modes of operation,
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individuals nationally through the network and sharing some of the best practices in investigation and prosecution and best practices of the c rooks so that we can cut some things off before they merged into a crisis lubbock's criminal-justice issue. >> i appreciate that your experience in the marines and as a prosecutor, picking wanting to just be around at meetings pinking great spots, i've always wanted to be one, as i am sure you do. >> thank you, senator. >> senator? >> a couple quick questions. thank you, mr. jones, for your service in the marine corps as well as a prosecutor. and at the department of justice. focusing again on the mortgage foreclosure issue, i wonder if
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you could tell us whether robosigning practices that were uncovered a year ago or more have given rise to any criminal investigations and prosecutions? >> you are correct. i think it came to light in late september and increasingly in october of last year. commonly referred to as robosigning. although there's more to it than that in the document issues for foreclosures. the task force, this is a benefit. there are certain things that will hopefully outlived the task force. the one that i am most proud of and that i think is necessary to fourth enforcement is synergy between federal and national.
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that has been a primary focus. because of that relationship- building that had already taken place as part of the task force, it had a very good platform to address this crisis, because so much of what is involved in an area is a state issue, but there's also a federal issue wicks hud and ftc and the department. so working group has been put together that is focused on that. we don't -- we will not discuss potential actions or investigations, but they are very focused on it. there's been discussion of negotiations with certain financial institution loan servicers. it's impossible to say right now what the result of all that will be, but certainly it is a focus. certainly, the department is committed to looking into it. in my estimation, i think critical to that success is a
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positive relationship between the federal and state authorities. >> i am aware of the state attorney general negotiations, but i am not aware of any department of justice investigations concerning potential criminal charges. the state attorney generals norcal investigating and perhaps negotiating possible civil claims. is there any consideration to a potential criminal charges? >> as i think has been stated publicly already, the department is committed to looking into this issue and being aggressive in pursuing it. we cannot confirm criminal investigations, if there are any. states have flexible authority in this area. as you know, some have criminal authority and some don't. some have broad authority. there are different ways in which foreclosures take place in
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different states. that is an important element of what we do. i can confirm the existence of criminal investigations, but we are certainly focused on it. we certainly are interested in continuing to pursue this matter with all the resources that we do have. >> >> did you have anything grant? did you have anything to add? >> bafta tread lightly. it would be fair to say that a number of my colleagues are very alert to the possibility that some of the activities might rise to the level of criminal investigations and potentially prosecution's and that is dispersed throughout the 94 u.s. attorneys' offices. there are certain geographic areas of the country where there is a higher likelihood that something could evolve into a
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prosecution and there are areas that are not. was that specific enough? >> you are understandably and correctly appropriately cautious. >> people are paying attention to the possibility. >> the only point i would make is that someone signing a false affidavit will be submitted to a court -- someone who signs a false affidavit that would be submitted to court with the proper evidence would be in violation of federal law. i hope that would be under investigation by the department of justice. again, thank you both? for your helpful and informative testimony today and and for your work in this area. >> thank you. >> i want to thank both of you for testifying. and both senators supporting here and sticking through the hearing and asking some good questions. i know senator pat leahy would like to submitted statements for the record, which i will do. and i want to thank senator pat
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leahy for his leadership and senator sessions in its leadership in this area of financial fraud. we will leave the record for the hearing open for two weeks. i just want to -- one week? we're getting very efficient in the senate now. we will keep the record of the hearing open for one week. with that i want to thank both of the witnesses for your work and your excellent testimony today. thank you. the hearing is adjourned. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2011]
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>> join us later today for remarks by a nasser administrator to talk about what is ahead for the inagency. astronaut mark kelly will be in attendance as well. that gets under way at 1:00 eastern. you can watch it live on c-span. at 8:00 eastern, henry kissinger will take part in a debate in toronto. the topic is china in the 21st century. that gets underway at 8:00 p.m. eastern on c-span.
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yesterday the u.s. sentencing commission voted in favor of making clothes or crack cocaine sentencing guidelines retroactive for prisoners already serving time for offenses. the final vote was unanimous. retroactivity will become effective on november 1 of this year. congress now has until the end of october to reject or modify the guidelines. this is about an hour. >> is there a motion to do so? is there a second camp of any discussion? now we need a vote on the motion. all in favor say aye. any opposed? the motion carries.
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now we move on to the matter before the commission today. good afternoon to everyone. thank you for coming to this important meeting regarding crack retroactivity. this meeting has been called on whether to apply retroactively the commission's and management implementing be fair sentencing act of 2010. let me begin with the statute. by statute, the commission is required to review and revise the operation of the sentencing guidelines and insure their conformance with federal statutes. by statute, the commission is also required to consider applying retroactively changes to the guideline that low or penalties. because of the importance of the burdens placed on the judicial system when the change to the
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guidelines is applied retroactively, the commission take this duty seriously and does not come to a decision on retroactivity lightly. you will hear more extensively from me and from my colleagues about the collaborative process the commission followed leading to today's vote. i want to make some comments on today's proceedings and the process that will follow. first, i want to make it clear that we are voting today on the retroactivity of the guidelines only. the commission cannot make the fair sentencing act itself retroactive. if there is an affirmative vote, not every federal crack defendant in the custody would see a benefit from retroactivity because the old
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statutory mandatory minimum will still apply. if the commission decides to give retroactive effect to be fair sentencing amendment today, it does not become effective immediately. it becomes effective on the date set by the commission provided the amendment itself is not disapproved by congress. that effective date is november 3, 2011. -- november 3, 2011. third, if there were an of firm agip vote on retroactivity, that does not mean -- an apartment of vote on retroactivity, that does not mean the defendants can leave immediately. every defendant who believes he is eligible for retroactivity must have his case considered by
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a federal judge who will ultimately decide if a modification of sentencing is warranted. that will be directed by the statutory limitations, the policy statement covering retroactivity, and the court's analysis of the statutory factors. the federal judges would be required to consider the defendant also risk to public safety in the motion to consider a reduced sentence. today is an important, historic day for the commission and board national sentencing policy as a whole. the commission has worked on this issue and has had everybody that the the reports written on the subject from 1995, 1997, 2002, and 2007. we have spent the last month
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since the hearing reading letters, over 43,000 letters, and reviewing the new issues raised by the supreme court and appellate district case law. our experts that has literally been working around the clock. the commission is grateful to everyone who sent in letters or testified regardless of what your position was on the issue. we want to hear from everyone when we make these important decisions. your views help us make important decisions. we look will work to working with all of you on the many issues before us. my colleagues and i will have more remarks. i would like to get the meeting started with our general counsel and the first order of business. mr. collins. >> before you is a proposed
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amendment regarding retroactivity. first, the proposed amendment would expand the listing in subsection c to include parts a and c as an amendment to be considered for retroactive application. part a amended been drug table or crack cocaine and made related revisions. part c deleted the cross reference under which an offender who possessed more than 5 grams of crack cocaine was sentenced under 2-d-11. second, to change the limitations in which imprisonment was less than the minimum. under the proposed amendment,
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the court shall not reduce the defendant's term of imprisonment less than the minimum guideline range. the amendment restricts the exceptions to cases involving government motions. for those cases, a reduction less than the amended guideline range may be appropriate. third, the proposed amendment amends the commentary to address confrontation issue. consistent with the three step approach and reflected in 1-1.1, the applicable guideline range is the guideline range determined by subsection a, which is determined before any
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the aryans. the proposed amendment -- which is determined before any variance. the proposed amendment adds commentary to refer to be supreme court case dylan v. u.s. the effective date would be november 1, 2011, the same effective date as the underlying amendment. >> thank you. is there a motion? is there a second? is there a discussion on the motion? i will ask the staff director to call the roll. >> the motion as described by
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the general counsel. the motion passes unanimously. >> thank you. does any commissioner wants to make a statement? commissioner jackson. >> in 1984, congress night only -- not only created the sentencing commission, it required the commission to consider retroacted applications of guideline sentencing reductions. the united states code is not ambiguous. it states that if the commission reduces the term of imprisonment recommended in the
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guidelines applicable to a particular category of offenses, it shall say what amount the defendants serving prison sentences they have their sentences reduced. in 2010, congress reduced the statutory minimum penalty threshold operable to crack cocaine -- threshold applicable to crack cocaine offenses. congress ordered the commission to make conforming penalty reductions in the guidelines crack cocaineto qua as soon as practicable. we are here today because the commission did just that. it has fulfilled its statutory
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duty under the purse sentencing act to reduce the term of -- pursuant to the their sentencing act to reduce the terms of sentencing. congressional silence about retroactivity in the third sentencing act tell us nothing -- retroactivity in the air sentencing act tell us nothing. congress could have addressed that issue, but it did not. now the commission must do what the sentencing reform act requires. i share the conclusion of my colleagues and many of you here today that parts a and c should be subject to a retroactive application. this conclusion rests on any
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basis, among them the thousands of letters and pieces of public written comments we have received on this issue, analysis of relevant data and consideration of the guideline that amendment in light of the established criteria by which the commission makes retroactive determinations. each of these criteria has been fully satisfied. the crack cocaine penalty reduction is not a minor reduction decides to facilitate the efficient guideline operations. it reflects the statutory change that is unquestionably rooted in fundamental fairness. the commission first identified the problems with the mandatory minimum statutes that penalizes crack cocaine offenders 100 times more severely than offenders caught with powdered
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cocaine in 1995. there is no federal decision that is more closely identified with unwarranted disparity been the -- tha the 100-1 crack -- than the 100-1 crack cocaine sentencing guidelines. the commission also estimates that a substantial number of crack cocaine offenders could not see a substantial change in their sentences. an official who testified at our hearing about their experience after having administered the penalty reductions before after the guidelines were reduced in
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2007 said these guideline changes would not be particularly burdensome. it is nothing automatic about a guideline change that has been made eligible for retroactive application under section 1b- 110. a federal judge must determine the appropriateness of a sentencing judgment, adjusting the sentence only if warranted and if the risk to public safety is minimal. judges have proven they are up to this task. 35% of the motions our rhetoric -- attracted applications were denied. -- retroactive applications were denied. we know from experience that not all will receive reduced penalties when the circumstances of their cases are reviewed and
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the retroactivity analysis is applied. this is precisely why the justice department's position on retroactivity need not be sustained. there is simply no need to employ imperfect proxy when an actor will judge with an actual case can make that -- when an judge with an actual case can make that call. it is well supported and fully consistent with the sentencing reform act, the fair sentencing act, prior experience and common sense. the commission has the statutory authority to commit penalty reductions.
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congress provided that authority to be used if ever the day should come when be retroactive application of a guideline penalty reduction furthers our societal interests in the avoidance of on warranty -- unwarranted disparities. this is that day. parts a and c address a sentencing inequity that the commission has known about and cared about for years. even before any of the currently incarcerated crack offenders would be eligible for retroactive benefits received their sentences. for the past 25 years, the 100-1 crack powdered disparity has cast a long and persistent chattel.
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-- persistent shadow. in my view, now that congress has taken steps to clear the air by making significant downward adjustments to the mandatory statutory penalties for crack cocaine offenses, there is no excuse for insisting that those serving excessive sentences under the prior guidelines must carry on as though none of this has happened. i believe the commission has no choice but to make this right. our failure to do so would harm those serving sentences pursuant to the prior guideline penalties and all who believe in equal application of the laws
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and the fundamental fairness of our criminal justice system. the decision we make today, which comes more than 16 years after the commission's first report to congress on crack cocaine, reminds me in many respects the up and often quoted statements from martin luther king jr.. he said, "the arc of the moral universe is long, but it bends toward justice." today, the commission completes the arc which began with its recognition of the crack cocaine/powdered cocaine disparity all those years ago. justice demands this result. thank you. >> judge?
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>> it is always a challenge to follow commissioner jackson and her poetry. before i get to the two parts of the amendment that reduce guideline sentences for crack cocaine, i did want to spend a moment talking about part b of the amendment, which incorporates all of the offenders, not just crack offenders. it is not part of the amendment that the commission is applying retroactively. i want to spend a moment addressing why that is. aggregating and mitigating
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factors in part b would involve time-consuming and administratively difficult to apply factors and support to look at on a retroactive basis. these are new factors that were considered byly judges. if we were to consider making that retroactive, it would require courts to engage in new that fighting with the need for hearings and possibly litigation over whether application of the aggregating factors would be warranted. this process would be administratively burdensome to the point of impracticality. we got no input from anybody suggesting otherwise. that contrasts parts a and c of
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the amendment, which we are voting for retroactivity in their application. we do not believe those would be unmanageable administratively to the courts. we think courts would be able to perfectly manage attractive applications of those two parts of the amendment. i do not want to repeat the history that commissioner jackson referred to. i do want to say that the sentencing commission has, for many years, said that crack sentences were too severe and unfair. under the leadership of our colleagues, we did something about it in 2007 by reducing guidelines sentencing were cracked by ability levels and making it retroactive in 2000 --
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guideline sentencing for crack by two levels and making it retroactive in 20008. -- 2008. our new chairman has led us through this debate on the permanent amendment and the consideration we have given today to making that amendment retroacted. i thank her for her able leadership. i know these past actions by the commission to recognize the work of many commissioners past and present, including the reports that were mentioned, has led us to be vote we take today. it is the culmination of many
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years of research, data -collection that makes us sure that the steps we took in 2007 and 2008 are the right ones. we have been able to come to a unified position on this issue, just as we did today. the commission's work helped persuade congress that reducing crack penalties was the right thing to do. in making this decision, we have heeded the input we have received both for and against the amendment and have taken careful stock of our statutory authority to reduce sentencing ranges. we have considered letters
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received from members of congress, some of whom have urged the interactive application and others who have not. those members who have cautioned against retroactive application have eloquently stated that silent on the issue of retroactivity on the third sentencing act should be a signal enough that we exceed our authority by making the amendment right to act under any circumstances. i want to take a moment to address this issue. the commission has used its authority infrequently to make retroactive amendments that reduce sentencing ranges. this is an important principle in our judicial system. we require good reason to disturb final judgments. the vast majority of the 750
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amendments to the guidelines have been to increase guideline penalties. 100 have reduced penalties. only 28 of the guideline reducing the amendments have been made retroactive over the history of the commission. the commission's authority to make guideline reducing amendments retroactive is consistent with the purpose and duties laid out for us by congress and in our organic statute. among the lofty goals, congress directed us to update initial amendments to the guidelines that reflect the advancement in the knowledge of human behavior as it relates to the criminal- justice process. practical goals included directions to examine the capacity of prison facilities.
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congress directed us to formulate the guidelines to minimize the likelihood that the federal prison population will exceed the capacity of the federal prisons. we are 35% over capacity in our federal prisons. congress has given the commission clear direction. that we must consider retroactive application of the guideline reducing amendments and that, as part of that consideration, we must take into account the purpose of sentencing set out in the sentencing reform act and our other statutory reform responsibilities both lofty and practical. we must avoid unwanted sentencing disparities. -- unwarranted sentencing
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disparities. i share the view of the congressional black caucus that retroactive application of the fair sentencing that guideline changes would help address racial disparities and excessive sentences for crack offenses and a long history of sentencing disparities. this commission has no agenda other than to fulfil our statutory duties to the best of our ability. i appreciate the concern that reducing the sentences of crack offenders since the bronx until the one that sends the wrong signal of being tough on crime. -- sends the wrong signal on
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being tough on crime. crackle when bush -- crack offenders will still serve tough sentences. in the end, i am proud of the work of this commission. i am proud to support retroactive application of parts a and b. >> a and c. >> a and c. sorry. >> the record stands corrected. >> my vote is based on the fair sentencing act of 2010, the legal standard regarding retroactivity, as well as the public comments the commission has received today, including the criminal law committee's testimony.
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congress argued that the commission does not have authority to give retroactive the facts because of the their sentencing act. the statute precludes a retroactive application of a statute unless congress states a clear intent otherwise. congress states no intent here. eat their sentencing act must be read in conjunction with the -- the fair sentencing act must be read in conjunction with the guideline amendment. that amendment is based on legislation that is silent with regard to retroactivity. consistent with section 1b-110, the commission has traditionally considered factors when considering giving retroactive
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effect to guidelines reducing terms of imprisonment. these include the purpose of the amendment, the magnitude of the change as a result of the amendment, and the administrative burdens associated with administrative activities. amendment 7 but the -- amendments 750 should be given retroactivity. the act and men's the drug quantity thresholds -- amends the drug quantity thresholds. it is reduced from 100-1. this change in the ratio is consistent with the commission also recent recommendations to congress.
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when promulgating a guideline pursuant to legislation, the role of the commission is to implement -- congress directed the commission to promulgate the guidelines and to make conforming amendments to the guidelines as the commission determines necessary to achieve consistency with applicable law. the purpose is reflected in the title itself. the commission implemented these congressional directives. the amendment ankle brace the 18-1 drug quantity -- the amendment implements the 18-1 drug quality ratio. it deletes the cross reference which required courts to
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sentence defendants with five or more grams of crack cocaine to at least five years in prison. congress did not express a clear pattask. it is a factor that weighs heavily against retroactivity. it is not an issue of what did the guidelines amendment should be given retroactive effect. amendment 750 lower skyline penalties and -- lowers guideline penalties. the commission must decide whether to give retroactive but that to any portion of amendment 750. -- to give retroactive effect to any portion of amendment 750.
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it will ensure that crack offenders are treated consistently under the guidelines. it will ensure a greater degree of fairness in sentencing. for more than 15 years, the commission has argued that the 100-1 drug quantity ratio was unfair. giving retroactive effect to amendment 750 will help remedy this injustice. i support retroactivity because i believe in the other two factors the commission must consider. the management of the changes and the administrative burden weigh in favor of the retroactivity of amendment 750. the mandatory minimum penalties that apply to offenders who
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committed crimes before august 3, 2010 remain in effect. with respect to the magnitude of the change, the commission estimates that 12,000 offenders will be eligible for a sentence reduction, 23% on average. these estimates are comparable to those associated with the commission's 2007 amendment. the estimated savings to the bureau of prisons are considerable. concerns expressed in 2007 have diminished significantly as a result of the supreme court's's decision -- court's decision in dylan v. u.s. as the judge made it clear in
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his testimony, the judges, probation officers, and litigants' implemented the 2007 -- litigants implemented the 2007 amendment. those eligible will be substantially less than they were in 2007. the commission anticipates that the majority of the motions can be handled without the need for hearings or the presence of defendants. to minimize the need for judicial back -- judicial that finding, the commission will applications to preclude sentencing reductions below the guideline range except in cases
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in which be offender has received a substantial reduction. these rules will set clear limits that will minimize and simple by any future litigation. the department of justice supports retroactive application of amendment 750, but has urged the board to bar certain offenders. mainly those in categories 4, 5, and six. i share the concerns voiced by the department regarding public safety. relative sentencing date data counters against excluding offenders in these categories. in 2007, there were no limits on retroactivity.
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it was mandated that judges consider public safety in deciding to exercise their discretionary authority. data reveals that judges exercise discretion pursuant to section 1b-110 on the merits on public safety grounds. recently, the commission completed a three-year recidivism study to compare the recidivism rate of crack of the lenders who were released earlier under the 2007 amendment -- rate of crack offenders who were released earlier under the 2007 amendment. crack offenders who fall within 6 areries or, b4,5 and
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subject to higher penalties in their sentencing. the amendment will not negate the extra prison time they are required to serve. of spenders in these categories will continue to serve longer prison terms than other crack offenders. to be sure, certain offenders pose a significant threat to public safety and should not be released prematurely. reductions in sentence are not automatic. federal judges are expected to exercise their discretionary authority to deny reductions to those who pose a threat to public safety. judges are required to consider the risk to the public in each and every case.
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the commission also decision today to give retroactive effect to amendment 750 will not take effect until november 1 of this year. this ballot-month delay will give congress ample time -- this four-month delay will give congress ample time to review the decision. it will also give the course, the department of justice, and federal offenders time to consider. >> thank you. on the theory of ladies before gentlemen, we turn to the gentleman. >> with respect to crack sentencing and considering changing decades of crack sentencing policy, it would be unconscionable if we fail to make this amendment retroactive.
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i want to reemphasize a few things. our estimation is that the average sentence served by crack offenders who will benefit by a reduction of sentence will still be in excess of 10 years. the bureau of prisons is 37% over capacity. that creates an undesirable conditions for prisoners and corrections staff. even with new prisons coming on line -- coming online, the prison population will be increased by several thousand prisoners per year. the bureau of prisons also estimates that over the next five years, the bureau of prisons could say in excess of $200 million while we are helping to alleviate overcrowding. i want to emphasize that while
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we have to emphasize -- consider the impact, it is based on fundamental fairness. >> first of all i would like to say, although not as eloquently as everyone else has been, by vote count as much as everyone else's in favor of this amendment. i would like to mention the three chairs who have worked on this matter. they have continued their work and have worked extremely hard on the crack cocaine issue. we also had a letter from a judge relating to retroactivity. everyone who is a chair or who has been a chair is in favor of this retroactivity. the commission is required to determine when there has been a reduction in the guidelines as
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to make it retroactive and what extent and under what circumstances judges should be able to do that. section 1b-110 in case there are other factors that the commission will consider. the purpose of the amendment, the magnitude of the chains, and the difficulty of applying the amendment retroactively. in 2007, we change the guidelines and made them attractive. it is clear to me and the other commissioners -- in 2007, we changed the guidelines and made them retroactive. retroactivity worked well and it is a more simple process that individuals might have thought. one of the important things we thought up at the time we voted
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with regard to the 2007 amendment is that we would consider the recidivism rates. the results we have received as a result of those studies show that there is no difference between the recidivism rates of those who had a reduced sentence as opposed to those who served the entire lengthy sentence. it is also important to realize that recidivism rates are relied upon as percentages and they are considering a rests that do not result in convictions. -- that they considered arrests that do not result in convictions.
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it is important for us to realize that we were given emergency amendment authority. congress felt it was important for the commission to act and act quickly. the present amendment we have sent to congress, which comes into effect on november 1 unless congress acts in the contrary, requires the commission's consideration with respect to retroactivity. the commission, in all of his decisions -- whether it is new guidelines or amendments to guidelines -- the commission, in all of its decisions, we see is comments of all of those interested in the criminal justice system. we received them from everyone with regard to this issue. we heard from members of congress.
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we have heard from the judiciary and from the general public, as well as from public defenders and individuals who practiced as defense attorneys. it becomes the role of the sentencing commission after having reviewed all of those comments as to what the right thing to do is. based on the decision of the commission, it does not mean any comment has been ignored or not taken seriously. quite to the contrary. every single piece of comment and every letter of commons as well as every letter of testimony has been considered. the commission has, unanimously to this decision. it is also important for us to
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bear in mind that all the commission does is make certain defendants eligible for a reduction in sentence. i think we are hearing from some of them right now. [laughter] they seem to be happy about it. it is also important to realize that the decision will continue to be in the hands of the judges. they will continue to make specific decisions on an individual basis. they are directed with regard to the guideline themselves to determine whether reduction is appropriate and to what extent it is appropriate within the limits set within section 1b- 110. with regard to those who say, use of a fire on, relevant conduct purposes -- that there
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should be distinctions -- is important to realize the guidelines have taken that into consideration. those with higher histories have been sentenced to hired sentences. these aggregating factors have already been considered with regard to the sentences that have been handed down. in closing, i would like to say that the sentencing reform act of 1984, for those of us on the bench before that act went into effect in 1987 -- it was an attempt to create a more fair system that avoided unwarranted disparity and set one system at the national level.
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senators kennedy, hatch, thurmond were part of that act. one other thing that was a part of the sentencing act of 1984 was a bipartisan commission set up to take the sentencing decisions out of the hands of the prosecutor and the defense attorney. the purpose of the act was to said be sent in southeast of the united states -- act was to set sentencing of the united states.
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today, the commission has done that with regard to its statutory duty and the decision as to how to proceed regarding retroactivity on a particular statute. it is fair to say that the commission in making its decision has acted outside the political process and out side of the requests of the -- and outside of the requests of the defense attorneys and the prosecution side of the case. it has acted on its belief that the judges will make individual decisions on each case as to whether it is the right thing to do in that particular situation. the decision has been made by each one of the members of this commission based on the consideration of all of the principles that need to be considered with respect to the
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retroactive application. this is the just, the clear, and the right thing to do. -- the fair and the right thing to do. >> thank you, a judge, for your leadership. a busy six months. we have addressed a variety of important issues ranging from health care fraud to firearm violence and many others. you have guided the commission deftly. many of my colleagues have mentioned different people who have participated in consideration of federal cocaine sentencing policy. it is fair to recognize all the
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people who have been about in this issue over the last 17 years. i will not try to name all of them. members of congress current and past, former members of this commission, the judicial conference, the commission staff, advocacy groups, and many others have participated in the consideration of tthis issue. i remember in the 1990's when the commission issued its report on federal cocaine sentencing policy. i want to mention the thousands of assistant united states attorneys, probation officers, and judges who work every day in federal courts across the country and were called upon to implement what the commission has voted to do today.
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they take their responsibilities seriously. i know they will faithfully execute the law and their duties to the best of their abilities. i do want to mention my colleagues in the u.s. attorney's offices from coast to coast will go to work every day with one thing in their mind, to keep our communities safe and to do justice. we all a great thanks to the entire federal court community. we have great fortune to work with remarkable individuals across the court family. the fair sentencing act is a historic piece of legislation. it addresses what we think is the single most important issue in trust and confidence in the federal justice system. a bipartisan basis and it was long overdue. the attorney general testified in person before this commission
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in support of retroactive application in implementing the fair sentencing act. he spoke about the importance of this issue to him and the cause of justice. i would not go over the reasons why the department supports retroactive application of this amendment. we are grateful. as the attorney general stated, we think retroactivity is a step forward for the cause of justice. this will take many months for implementation. we think it is imperative for the courts to consider the implementation of retroactivity. we appreciate the planning that the commission and the staff have already done. we pledge to you our support to see that retroactivity is done in any efficient way to see that the courts to get the information they need to make
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informed decisions. we are committed to implementing this decision to achieve twin goals of public safety and justice. the attorney general indicated some of our public safety concerns on retroactivity. we need to do all we can to ensure that the thousands of case by case retroactivity determinations are robust and that thoughtful decisions are made in every single case. as we have noted often, violent crime rates across the country are at a generational lows. parts of the reason for that is tough sentencing policy. -- part of the reason for that is tough sentencing policy. there are important systemic issues facing the commission over the coming months. tough sentencing policy can be fair sentencing policy.
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the commission's actions are consistent with tough and fair sentencing. thank you again, judge, for considering our views and for your leadership. >> it is with enormous pride that i preside today as chair of this historic moment. the united states sentencing commission is a bipartisan body. we were nominated by the president and confirmed by the senate. which consists of judges and former prosecutors and former defense attorneys. we have worked hard over the last months to come to today's decision and to make the amendment to the united states sentencing guidelines that reduce penalties for selling and possessing crack cocaine retroactively. it reduces the average sentence by 37 months. that average sentence will draw
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one had a 64 to 127 months. the purpose is to fix a fundamental unfairness in our justice system. after extensive research, the commission recognized that sentences for crack cocaine or unfairly high. they reached below the level of mid-level and low traffickers. they applied to low-level street dealers. crack cocaine offenders are african-american by a an overwhelming majority. we believe retroactivity is fair and consistent with the purpose of the fair sentencing act of 2010. this vote on retroactivity will prevent prisoner-- allow
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prisoner is to -- allow prisoners to petition a court for release. before any prisoner is released, the court has an obligation to willider whether release create a threat to public safety. there was discussion about the precise form retroactivity should take. retroactivity in some form has been supported by the attorney general of the united states, the criminal law committee of the judicial conference, senators leahy, a third man, frank and -- senator durbin, senator frank, and many other advocacy groups.
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for over 15 years, the commission has advocated that congress should reduce the crack penalties to rectify the fundamental unfairness of punishing crack cocaine 100 times more seriously than powder. a broad bipartisan coalition in congress led by senator dick durbin of illinois and senator jeff sessions of alabama worked to pass the new law in the senate. the new law was passed under suspicion of the rules in the house. not all prisoners will be entitled to this reduction. prisoners who received a departure of baryons below the equivalent of the new guideline variance ure of dair below the equivalent of the new guideline range will not receive assistance.
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second, career offenders, people who already have a serious criminal record, will not get the sentence reduction. many prisoners will be bound by that story minimums. at the hearing, -- many prisoners will be bound by statutory minimums. there was understandable criticism. there were some carrying members of congress, like congressman grassley and congressman sessions. the commission has weighed these thoughtful criticisms with care. we decided these policy concerns did not prevail. did not prevail.


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